If the Auditor Is Testing Long-Lived Asset Account Balances to See

question 55

Multiple Choice

If the auditor is testing long-lived asset account balances to see if they include all relevant transactions that have taken place during the period,what is the primary assertion being tested?

• A)Presentation and disclosure.
• B)Existence.
• C)Completeness.
• D)Valuation.

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Definitions:

Realized Gross Profit

The portion of profit that has been earned from completed sales transactions, excluding unrealized profits from continuing transactions.

Bundled Sales Transactions

sales deals that involve multiple products or services sold together at a combined price, potentially affecting revenue recognition and reporting.

Revenue Recognition

The accounting principle that dictates the specific conditions under which revenue is recognized and recorded in the financial statements.

Right Of Return

A policy allowing customers to return purchased goods under certain conditions, often within a specific time frame.